Ford's Third Quarter Results Exceeded Expectations

Ford Motor Company (F) announced its third-quarter results, which exceeded market expectations. However, financial losses are expected due to a fire at the Novelis aluminum plant, which adversely affects Ford's F-150 trucks and SUVs.

Ford stated that the fire at the Novelis aluminum plant in New York would have a negative impact of between $1.5 billion and $2.0 billion on the adjusted EBIT for 2025. This situation will also affect cash flow at year-end, but the company expects to make at least a $1 billion correction in 2026. The full effects of the fire will be reflected in Ford's fourth quarter.

Ford anticipates that the impact of Novelis will be $1 billion or less between 2025 and 2026.

As a result of these negatives, Ford revised its annual guidance downward, now projecting adjusted EBIT of between $6 billion and $6.5 billion and free cash flow of between $2 billion and $3 billion. Previous estimates were $6.5 billion to $7.5 billion and $3.5 billion to $4.5 billion, respectively. Ford noted that production disruptions have negatively impacted working capital in the short term, but this is expected to reverse next year.

Ford's Chief Financial Officer Sherry House stated in a press release that if there had been no Novelis fire, the company would have raised its annual guidance. Ford's COO Kumar Galhotra also highlighted that there would be "disruptions" in F-150 production in the coming weeks.

Currently, Ford shares have lost 3% in after-hours trading.

In addition to various developments, Ford plans to increase F-150 and F-Series Super Duty production by more than 50,000 trucks in 2026 to meet demand and compensate for production losses caused by the Novelis fire. However, the production of the electric F-150 Lightning truck will be paused to prioritize gasoline and hybrid truck production.

For the third quarter, Ford reported automotive revenue of $47.185 billion, exceeding Bloomberg consensus estimates of $43.70 billion. The adjusted earnings per share were recorded at $0.45, above the expected $0.36. Ford reported adjusted EBIT of $2.6 billion, exceeding the expected $2.02 billion.

The company is also grappling with the effects of automotive tariffs imposed by President Donald Trump, which cost Ford $700 million in the third quarter, with a net effect of $1 billion by year-end. However, with the new automotive tariffs, this impact was reduced by $1 billion for Ford and other domestic auto manufacturers.

The government has extended the period for automakers to offset tariffs against the percentage of the value of vehicles assembled in the U.S. Ford produces 80% of its vehicles in the U.S. and is expected to benefit from this. Additionally, it is anticipated to benefit from tariffs on medium and heavy-duty trucks.

Ford has divided its business into three units under the Ford+ plan: Ford Blue for traditional gasoline business, Ford Model e for electric vehicle division, and Ford Pro for commercial and super-duty business. According to Bloomberg data, Ford is expected to report the following results:

• Ford Blue: $28 billion in revenue, $1.54 billion EBIT
• Model e: $1.8 billion in revenue, -$1.41 billion EBIT
• Ford Pro: $17.4 billion in revenue, $1.985 billion EBIT

Despite tariff challenges, Ford's sales rose strongly in the third quarter, led by trucks and electric vehicles. Total Ford sales reached 545,522 units, up 8.2% year-over-year. Truck sales, particularly for the F-Series, Ranger, and Maverick, increased by 7.4%, with F-Series truck sales rising by 13% year-to-date.

As a result, Ford achieved its highest electric vehicle sales in the third quarter. Electric Mustang Mach-E SUVs and F-150 Lightning pickups garnered significant interest among buyers before the expiration of the federal electric vehicle tax credit. September marked the seventh consecutive month of sales increases for Ford.